Gold bugs always seem to be worried about social and financial collapse and think gold is going is to retain lots of value in that scenario.
I have to wonder if this is true, if there really was a financial and social collapse wouldn’t more utilitarian things necessary for survival and like a case of axes or knives or even fish hooks be far more valuable than a bag of gold ?
Gold’s been valuable for severla thousand years in most places.
If society collaapses, banknotes are worth zero, gold is still, through a mostly subjective process maybe, gold
I read the comparison somewhere, even if it’s not perfect.
When Constantinople fell, the coins didn’t change value. When the CSA surrendered, confederate dollar became worthless.
If our current society collapses, in the immediate and maybe medium term aftermath gold would likely be useless or less useful than non-perishable foods, weapons, and farming implements etc.
It depends on what level the collapse is to. If we drop all the way back to a hunter-gatherer level then gold probably wouldn’t be worth much. Of course neither would farm implements.
But if you have some form of civilization, gold would probably be valuable. Even primitive societies like ancient Sumer valued gold. As soon as people get organized and settle down, somebody is going to rise up in the hierarchy and want some luxuries to show his status.
Nah: if society collapses, some violent jackass is going to mash your head in and take your gold, the very moment you show that you have any.
When society starts to rebuild itself, gold might be worth having. But, then, the new government might not permit private ownership, and you’re only a little better off than you were with the violent jackass.
Personally, I’d go with a box of woodworking and metalworking tools – and the skill to use them. That makes you valuable. The V.J. can take your gold, but a good carpenter or blacksmith is value-on-the-hoof.
Look, society as we know it collapses and we’ve got a barter economy. Bill has laying chickens and a couple dozen eggs available for barter. Charlie has 1 oz gold coins. Do you expect Bill to make change? And if I’m there with neither eggs, chickens, or gold coins, but I do have a Colt Combat Commander, there’s a plenty good chance I’m going to end up with the eggs, chickens, and gold without worrying about making change.
Just sayin’, yanno?
How does it work, as things stand right now, with gold ownership? When you buy gold, do you actually get the solid metal delivered into your personal possession? Or do you get a certificate saying that some amount of gold (stored in a big big vault somewhere) is now yours?
If you just get a certificate but the actual metal is in a big vault somewhere (along with everybody else’s gold), then what’s it worth to you when civil society collapses? What are the chances that you will still, in any effective sense, still own that gold? More likely, you will own a worthless piece of wallpaper that pretends to assert that you own some gold.
Depends on whether you’re buying gold (metal) or gold futures (certificate).
I guess stocking up on gold is a useful exercise if the collapse that happens is only localised. If say for instance the US collapse but other countries survived then I think in that scenario having gold would still be useful. You effectively still have societies who value gold to trade with. Maybe you could use your gold to buy your way into another country.
If we are talking a complete collapse of all civilisation I guess gold might have value to some who have not grasped the situation yet.
Gold is a useful medium of exchange, it’s difficult to fake (especially with low technology), and doesn’t wear out or rot. It’s good for that point in time when you move beyond straight barter and want to just trade your goods/services for a neutral item that can be traded later.
As noted, it all depends on the level of collapse. Mad Max time and gold is useless. Hyper-inflation and country-level collapse and it is still useful.
A friend of mine just told me a story that kind of changed my mind on this. His father was in China during the revolution and was trying to get on one of the last planes leaving for Taiwan. The pilot wouldn’t let him on board, declaring his ticket worthless, and laughing when offered cash. It took gold bars to change his mind. While fishhooks and canned food have a certain utility, they would not have worked in that circumstance.
Come total collapse, I prefer lead and brass. With the proper application of those in the proper calibers, I can get all the gold and damn near anything else I want.
I guess I don’t understand what people mean when they say “Civilization collapsing”. I guess they’re imagining the fall of Rome or somesuch. But even that wasn’t experienced as a collapse of civilization, rather it was a bunch of barbarians moving in and killing and enslaving everyone. Is that going to happen in America?
There are a couple of scenarios here. One is some natural disaster that means your house is destroyed, there isn’t any electricity or water or food, and rescue crews can’t get to you for various reasons. In this case, gold isn’t very helpful, but neither is cash. And when the rescue crews move in, you aren’t going to be wishing you had gold on hand.
The other is some major economic dislocation. OK, if there’s hyperinflation pretty soon your US dollar notes are worthless. Gold is helpful in this case because gold can be used as money in the absence of useful paper currency. But here’s the thing. What is the use of gold? It’s to trade for the things you actually want. But you can’t do that without giving away your gold. So you don’t actually want gold, you want a durable store of value that you can trade for other things. And it’s not like we’re going to wake up tomorrow and find that overnight the US dollar is worthless. It’s going to be a long slow slide.
And the problem won’t be solved by immediately buying gold, because how much gold are you actually going to have? Enough to live on for years? Because the big problem is not going to be that your savings account was dollars in a bank and not gold coins under the mattress. The problem will be that you can’t find a job. Pretty soon your savings and investments are used up. But hey, nice to have a couple month’s worth of cushion that can’t be yanked out from under you at the stroke of a pen.
Other things like total governmental collapse, well, you might need gold to pay bribes. But this is going to be something more like the last days of the Confederacy rather than Mad Max.
I don’t think the fall of Rome was even that devastating. The barbarian invaders certainly did pillage and plunder after successfully pillaging Rome and other cities. Undoubtedly there were many incidents of rape, slaughter, and enslavement during these events, but the invaders didn’t enslave everyone. Of course many ordinary people were already living in a state which amounted to serfdom, but that had happened a century or two before, under the Empire.
For quite some time, the barbarian rulers of Italy relied on educated Italians, mostly of the elite, to run the civil service and basically keep things running.
Gold is hard to find and it’s shiny. What more could you want in a makeshift currency?
That’s why you have silver coins as well as gold, for smaller transactions. The gold is intended as a larger store of value. Believe me, people will figure out how to make change (there are also smaller gold coins, not everything has to be one ounce).
My take on this question is this: for anything higher than utter subsistence existence, there will always be people who value gold and silver, and will trade goods for it. That’s how they came to be used as money in the first place.
But most gold bugs don’t really expect that level of collapse. The ones I have read are all worried about things like government debt out of control and runaway inflation. In that sort of scenario, gold is, well, gold.
Roddy
Not immediately. Survival goods like potable water, food, and salt will be much more valuable in the short-term. Possibly weapons, too, but that kinda depends on why society collapsed in the first place, and how well our existing laws, government, and boundaries continue to function.
But within a few generations, there could be lots of people who’ve only ever known a post-electronic age. They’ll probably like gold a whole lot because it’s durable, pretty, and pliable. It’s the original example of conspicuous consumption.
I was going to post about a friend’s similar experience. Her family escaped from the Khmer Rouge by bribing people, both Cambodian and Thai, with gold. Despite all of Pol Pot’s rhetoric about restarting society and getting rid of wealth, gold still had its appeal.
Actually, the fall of Rome wasn’t even like that. Really it was more of a complex transformation and decline over a century or more than a sudden catastrophic collapse.
Do we even have a model for what the collapse of a modern democracy would look like?